• by March 21, 2005

Our favorite butler, Jeeves, is headed to IAC/InterActive Corp., media mogul Barry Diller's company, according to this morning's news reports.

IAC is poised to acquire search service Ask Jeeves for nearly $2 billion in stock. Diller's IAC will likely use Jeeves to drive traffic to its Expedia.com travel site, Match.com dating destination, Citysearch listings and reviews, and Home Shopping Network site. It will also use Jeeves to rack up search-related ads. About 70 percent of Ask Jeeves' revenue is drawn from ads negotiated by Google.

If the Jeeves acquisition goes through, IAC would be armed to go head-to-head with Google, Yahoo!, and Microsoft Corp.'s MSN in the market for ads tied to Web search results. The market for ads linked to search results is projected to triple to $12.6 billion by 2010, according to Minneapolis-based Piper Jaffray Cos.

Ask Jeeves had 5.3 percent of Web searches in the U.S. in December, according to comScore Media Metrix. Google has more than 40 percent of the market.